By Amrith Ramkumar 

Oil prices fell Friday after China said it would impose tariffs on $75 billion worth of additional U.S. products including crude imports, the latest protectionist trade policy that could crimp fuel consumption.

U.S. crude futures fell 2.3% to $54.07 a barrel on the New York Mercantile Exchange following the announcement, the newest salvo in the U.S.-China trade spat that has swung markets in recent months. Oil is about 18% below its April peak with analysts wary that softening demand and steady supply will result in a glut.

Brent crude, the global gauge of prices, declined 1.6% to $58.96 a barrel on the Intercontinental Exchange.

U.S. crude is among the many products affected by new Chinese duties in the coming months, and some analysts are wary that the latest tariffs will further slow the global economy and weaken commodity demand broadly. Chinese imports of U.S. oil have generally fallen in recent months as the drawn-out trade spat between the world's two largest economies continues.

Many organizations have revised down their expectations for oil-demand growth in 2019, increasing pressure on the Organization of the Petroleum Exporting Countries and other large suppliers to limit output moving forward.

Generally rising inventories in the U.S. and globally have also added to fears of excess supply, with several new production sources around the world also expected to boost global crude output next year.

Investors are looking ahead to scheduled trade talks between the U.S. and China next month to see if the two sides can reach a compromise.

They were also awaiting a speech from Federal Reserve Chairman Jerome Powell later Friday, as some expect lower interest rates around the world to help the global economy stabilize despite continuing trade uncertainty.

Elsewhere in commodities Friday, natural-gas futures fell 1.5% to $2.127 a million British thermal units, also hurt by continuing fears of oversupply.

Most-active futures for copper, an industrial metal that counts China as the largest source of global demand, declined 0.6% to $2.5415 a pound on the Comex division of the New York Mercantile Exchange to extend a recent slide.

Gold added 0.2% to $1,511.90 a troy ounce, staying near a six-year high as nervous investors continued to boost the safe-haven metal.

Write to Amrith Ramkumar at amrith.ramkumar@wsj.com

 

(END) Dow Jones Newswires

August 23, 2019 10:19 ET (14:19 GMT)

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